investing in high risk mutual fund.

Discussion in 'Community Discussion' started by gregdrummeraz, Mar 8, 2008.

  1. gregdrummeraz macrumors 6502

    Joined:
    Jun 7, 2007
    Location:
    Glendale, az
    #1
    I was thinking of investing one of the following.


    DXZLX
    IACFX
    or
    like AACFX


    What do you guy's thinkg about investing in funds with high risk?:eek:



    I am only 17 but my parent's will let me sign up for scottrade. :rolleyes:



    I will be 18 in like 9 month's.





    generally, not about me but the high risk investment's. :D


    Greg:apple:
     
  2. MikeT macrumors member

    Joined:
    Mar 10, 2005
    #2
    I've done very well recently with this exchange-traded fund: Swiss Franc Trust (symbol: FXF).
     
  3. gregdrummeraz thread starter macrumors 6502

    Joined:
    Jun 7, 2007
    Location:
    Glendale, az
    #3



    Looks's like 1 single share to me? diversify much :D

    what was your return last year? percentage wise?



    it also says last years return was %9.5

    correct me if I am wrong.
     
  4. MikeT macrumors member

    Joined:
    Mar 10, 2005
    #4
    About 16%.

    The fund has obviously benefited from the plunge in the U.S. dollar.
     
  5. gregdrummeraz thread starter macrumors 6502

    Joined:
    Jun 7, 2007
    Location:
    Glendale, az
    #5



    here's a simple questions.


    does my mutual get the yield or the year to date return?


    and.. of not ut I am downloading the SDK right now out a meg a second almost!!!



    got to love when everyone one is sleeping and you get ALL the bandwidth! :D:D:D:D
     
  6. MikeT macrumors member

    Joined:
    Mar 10, 2005
    #6
    The yield is based on a dividend that it is paid to shareowners. As long as they don't cut the dividend, it's what you will receive on an annual basis if you own the fund (or stock).

    The year-to-date return tells you how the fund/stock has performed since the beginning of the year. The one-year return tells you how the fund/stock has performed over the past 52 weeks. These statistics tell you nothing about how the fund/stock will perform in the future. Future returns might be negative (i.e., the fund/stock could decline in value), or they might be even better. It's a gamble.
     
  7. gregdrummeraz thread starter macrumors 6502

    Joined:
    Jun 7, 2007
    Location:
    Glendale, az
    #7



    ok.. in simpler terms. if I am yielding %8 but returning %100.


    which do I get? 8 or 100? :confused:
     
  8. MikeT macrumors member

    Joined:
    Mar 10, 2005
    #8
    Again, unless they cut the dividend (which sometimes happens), you'll get the 8%. It's inaccurate to say that any investment is "returning" 100%. It may have "returned" (past tense) that much over the last year because of increasing value of the shares, but that doesn't mean anything in terms of future returns.
     
  9. foidulus macrumors 6502a

    Joined:
    Jan 15, 2007
    #9
    Read the post closely, then read about what an ETF is. I cannot comment as to the particulars of this ETF, but they can be quite "diverse" while trading "like" a single company stock.
     
  10. gregdrummeraz thread starter macrumors 6502

    Joined:
    Jun 7, 2007
    Location:
    Glendale, az
  11. MikeT macrumors member

    Joined:
    Mar 10, 2005
    #11
    Let's say that you're looking at a security (stock, mutual fund etc.) that pays a $5 divided per share. If the security costs $100, the yield is 5% (i.e., $5 divided by $100). But if you buy the security, and the company that issues it later cuts (reduces) the dividend to $1, then your yield is only 1%. Of course, it's also possible that they will raise the dividend.
     
  12. abbynelson28 macrumors newbie

    Joined:
    Dec 2, 2008
    #12
    Thanks for the info guys..i was totally blank initially but when i read it closely it starts making sense...
    :)

    ----------------------------------
    Abby Nelson
    merchant services
     
  13. InvalidUserID macrumors 6502a

    InvalidUserID

    Joined:
    Sep 7, 2008
    Location:
    Palo Alto, CA
    #13
    It all depends on your risk tolerance. Some people can't sleep with the volatility while it doesn't bother others. I fall into the latter.

    I would advise you to start looking at the numbers on stocks/funds, compare them with similar funds, compare them with the proper index, look at the fund managers, etc rather than ask someone what they thought about "X" stock/fund.

    I will say this though: If you aren't willing to lose with a risky investment, don't invest in it. I know it sounds silly but its reality. If it is money you'll need soon or can't live without, invest in a money-market account or bonds. But you are very young and have a LOT of time to ride out any volatility.

    If you have the time, pick up "What Works On Wall Street". Nice book, I read it and passed it on to a friend.
     

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